“Best Practices Are Stupid” Named One of the Best in 2011

I’m pleased that the American Express OPEN Forum (via Matthew E. May) selected Best Practices Are Stupid as one of the top 15 books of 2011.  Check out the complete list

Also, Best Practices Are Stupid  was selected as one of the “Top-Drawer Business Books of 2011″ by the advertising agency, DDB.  See the complete list here

And, in case you missed it, there is an excellent review of the book on the Actionable Books website.  Read it here

Ask a Different Question, Get a Different Answer

Today I want to test your mental muscle with an activity I conduct with my clients.

If you are a college sports fan, you will most likely be familiar with the NCAA basketball playoffs. 65 teams in total compete. The games are organized into brackets like the one illustrated here. Teams compete with the hope of making it into the “sweet sixteen,” the “final four,” and then ultimately being crowned the champion. The tournament is single elimination – that means that after each game, the winner advances to the next round and the loser’s eliminated.

With the NCAA tournament, the two lowest ranking teams compete against each other to get the 64th slot in the bracket.

The question is, “How many games need to be played in order to determine which team is the champion?”

The only way most will be able to find the answer is to draw out the full bracket and count the number of games in the chart. As a result, when I ask groups this question, it takes quite some time for everyone to answer correctly.

However, consider this.  If I were to phrase the question differently, I can guarantee that you would find the solution instantly.

Instead of asking, “How many games need to be played in order to determine which team is the champion?” what if I asked, “How many games need to be played in order to eliminate all of the losers?”

The answer should now be obvious. If you have 65 teams playing, 64 teams must lose. Since the tournament is single elimination, 64 games need to be played to eliminate all of the losers. Therefore 64 games need to be played in order to determine which team is the champion.

This simple exercise makes an incredibly important point. The way you phrase a problem will lead you down the path of a particular thought process. This, in turn will lead to a particular solution. How you ask the question will impact the manner in which you innovate.

A company who brainstormed, “How can we more effectively use 360 degree feedback?” completely missed alternative methods for addressing their larger management issue. If they had asked, “In what way might we create powerful leaders?” they would have found very different solutions.

An office supply company that asked the question, “How can we more effectively sell our products to school administrators?” completely missed the fact that the teachers were the real buyers and that that the administrators merely filled out the paperwork. In this case they should have done their homework to understand the real buyer first before looking to find solution.

Or when NASA wanted to “create a zero gravity laundry system” for space travel, they missed out on possible solutions that involved other methods for cleaning clothes or creating a material that does not require cleaning.

Asking the right question – the right way – is the surest way to accelerate your innovation efforts and for finding better solutions. Just as the NCAA tournament example showed, sometimes a very small change can have a significant impact on the way you view the problem.

I Won’t Work for Money

The other day I was asked to speak for a company that had a limited amount of money and could pay me only 15% of my speaking fee.

Today I was asked to speak at a company in exchange for my receiving bicycle in lieu of cash (as you may guess, they manufacture bicycles).  The value of the bicycle is less than the cash the other company offered me.

Which gig, if any, did I accept?  What do you think?

Interestingly, I immediately turned down the cash offer yet accepted the barter deal.

Does this mean I am crazy?

No, actually, it means I am human.

I recently presented at an event where another speaker, Francois Gossieaux, quoted research done by Dan Ariely.

In a nutshell, when a dollar value is assigned to a task, people weigh the effort against the financial return.  But if no dollar amount is specified, we evaluate it differently.

For example…

• If I asked you to do me a favor, you might be inclined to do it simply to help me out.
• If I offered you a gift (e.g., a nice dinner) in exchange for your help, the gift may not weight heavily in your decision making process.  You would probably still do it to help me out.
• But if I offered you $100 cash, now you would then evaluate if your investment of time is worth that much money.
• Interestingly, if you say, “I’ll give you a gift worth $100,” you now evaluate it the same way as you would cash.

This has interesting implications for a company’s innovation efforts.

If you offer cash rewards, people will determine if their efforts are worth the extra money.

Giving a gift without assigning a value will be a greater motivator.  But if you assign a value to the gift (e.g., gift cards), you may reverse the positive impact of giving a gift.  Giving “points” that can be accumulated and exchanged for prizes is a nice middle ground that avoids a direct value assignment.

From my experience, the best “extrinsic” motivators are the “priceless” rewards.  These are things you can not buy – extra vacation days, a prime parking space, or dinner with the CEO.  These can not be assigned a dollar value.  And in the case of dinner with the CEO, this also taps into another motivator – status.  After the dinner you can taunt your friends, “Guess who I had dinner with last night.”

By recognizing the way people make decisions, you can find more effective – and often less expensive – ways of motivating them.

You now also know more effective and less expensive ways of getting me to help your organization innovate.  I wonder what I will be offered next.

The Invention of the Mouse

Malcolm Gladwell has an excellent piece on how Apple created its first computer after visiting Xerox parc.  In particular, he discusses how the mouse was developed.

After Jobs returned from parc, he met with a man named Dean Hovey, who was one of the founders of the industrial-design firm that would become known as ideo. “Jobs went to Xerox parc on a Wednesday or a Thursday, and I saw him on the Friday afternoon,” Hovey recalled. “I had a series of ideas that I wanted to bounce off him, and I barely got two words out of my mouth when he said, ‘No, no, no, you’ve got to do a mouse.’ I was, like, ‘What’s a mouse?’ I didn’t have a clue. So he explains it, and he says, ‘You know, [the Xerox mouse] is a mouse that cost three hundred dollars to build and it breaks within two weeks. Here’s your design spec: Our mouse needs to be manufacturable for less than fifteen bucks. It needs to not fail for a couple of years, and I want to be able to use it on Formica and my bluejeans.’ From that meeting, I went to Walgreens, which is still there, at the corner of Grant and El Camino in Mountain View, and I wandered around and bought all the underarm deodorants that I could find, because they had that ball in them. I bought a butter dish. That was the beginnings of the mouse.”

This is a simple, yet powerful example of how a well-defined challenge can transform an industry.  What challenge can you frame that will help you redefine your industry?

What I Learned From An Expired Bottle Of Mayo

The late Steve Jobs once said, “Creativity is just having enough dots to connect…connect experiences and synthesize new things. The reason creative people are able to do that is that they’ve had more experiences or have thought more about their experiences than other people.”

Or, in my words, in order to innovate, you need to collect and connect the dots.

The other night I decided to make myself some tuna fish. As I started to prepare my meal, I realized that the 18 ounce squeeze bottle of mayo I was about to use had expired six months prior. I guess I don’t use it very often because the bottle was still 90 percent full.

After throwing out my expired food in frustration, I realized that there is a lot to learn from things we routinely do around the home. Here are just three of the lessons I learned from around the house.

Fail cheaply

Although Costco is one of my favorite stores, I rarely buy perishable items there. As a person who lives alone, I find it difficult to predict how much I will use. Sometimes, as is the case with my mayo, buying the smallest size and paying a premium is better than saving money on larger quantities. Smaller quantities result in less space used, less waste when things aren’t needed and lower costs all around. In business, your best bet is to become masterful at creating small, inexpensive and scalable experiments that give you insights into the real world, not just backroom-based predictions. As you gain new insights and become more confident that a new idea will work (i.e., there is greater predictability), then you can ramp up and go for efficiency.

Sell one, make one

It’s safe to say that one situation no one ever wants to encounter is to be sitting on the toilet and running out of toilet paper. The best solution is to always have a spare roll within reach. When the main roll is finished, the spare role is put into the dispenser and the backup roll is replaced. This is an example of a simple manufacturing technique called “sell one, make one.” To avoid running out of product, companies often produce large quantities of inventory. But as we saw in the “fail cheaply” example above, this can lead to waste. Items that don’t sell need to be liquidated at significant discounts. In the meantime, the inventory takes up space and hurts your cash flow. Instead, if you get your manufacturing process (or your innovation implementation process) efficient enough, you can make one immediately after you sell one—that is, when you sell one, you make one. You will never run out if demand never exceeds your ability to manufacture.

Lather, rinse but don’t repeat

Shampoo bottles are infamous for telling you to lather, rinse and repeat. Perhaps I am one of the few, but I had been following these directions every morning without much consideration. As an experiment, I tried skipping the repeat step. No difference. I even experimented with using less than one pump of shampoo. Same result. Sometimes we take on wasteful activities because we never think to step back and question them. I reduced shampoo usage by 75 percent without any impact on my hair. From my experience, most companies can reduce wasteful activities simply by questioning what has always been done in the past.

Three simple insights, and all were generated from a bottle of mayonnaise.

Want to improve your business? Start by looking around your home. Every day, take an inventory of the innovative products you possess…

Read the rest of this article on the American Express OPEN Forum

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